Unification of Oligopolistic Markets for a Homogeneous Good in the Presence of an Antitrust Commission
Raúl Bajo-Buenestado () and
Journal of Industry, Competition and Trade, 2015, vol. 15, issue 3, 239-256
A basic framework is provided to explain the integration process experienced by oligopolistic markets serving a homogeneous good in different countries. Over the past few decades, such processes have been observed, for instance, in some European markets – in particular, in the energy sector. The idiosyncratic element here is the introduction of an exogenously given antitrust commission that supervises competition in the market and has the authority to fine firms for anticompetitive behavior. We model the unification decision as a simple cooperative non-transferable utility game. We find that the creation of an antitrust commission plays a major role in providing the necessary incentives for market unification. In particular, the commission is able to induce unification of all markets via appropriate choice of antitrust policy. This stands in stark contrast to the benchmark scenario in which the antitrust commission is absent – here, market unification never occurs. We propose the Iberian Electricity Market (MIBEL) as a case study. Copyright Springer Science+Business Media New York 2015
Keywords: Economic integration; Oligopolies; Antitrust law; Market structure; F02; L13; L40 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:kap:jincot:v:15:y:2015:i:3:p:239-256
Ordering information: This journal article can be ordered from
http://www.springer. ... on/journal/10842/PS2
Access Statistics for this article
Journal of Industry, Competition and Trade is currently edited by Karl Aiginger, Marcel Canoy and Michael Peneder
More articles in Journal of Industry, Competition and Trade from Springer
Bibliographic data for series maintained by Sonal Shukla ().